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13-06-13

Brussels – Ray Kroc – Formidable

Ray Kroc – The brain behind the franchising of McDonald’s and making it the biggest name in the Fast-Food Industry

Ray Kroc was born on October 5, 1902, in Chicago, Illinois. He attended public schools in Oak Park, Illinois. He left school to serve as an ambulance driver during the First World War. After the war, Kroc tried his hand on being a paper-cup salesman. He became a jazz pianist and started playing in various orchestras. He worked in the Chicago radio station for a while as a music director, after which he became a milkshake machine salesman. The milkshake machine was his own invention. In 1941, he chose to serve as a distributor of the milkshake machine.

During the real estate boom in Florida, he began selling real estate. However, he had to retire to his pianist occupation, after the real estate market in Florida went down in 1926. By now, he was a father of one child. During the economic crisis, he had to send his family back to Chicago. He, eventually, started working as a paper-cup salesman again.

In 1954, Ray Kroc came to know about the drive-in restaurant run by Richard and Maurice McDonald, located in San Bernardino, California. He learned that they used his multi-mixer machines and were making good money out of selling hamburgers, milkshakes and french fries. He was struck with an idea of starting a franchise in collaboration with the McDonald brothers. He approached the McDonald brothers with a proposal that he would use their name and standards and start a chain of McDonald’s restaurants. According to the deal, would be getting one-half of the gross income of their business. The McDonald brothers agreed to his proposal and Kroc opened the first chain of McDonald’s restaurants on April 15, 1955 in Des Plaines, Illinois.

Six years later, Kroc would buy out the McDonald brothers for $2.7 million, but more importantly he would gain complete control over the business. “The McDonald bothers were simply not on my wavelength at all” said Kroc. “ I was obsessed with the idea of making McDonald’s the biggest and the best. They were content with what they had; they didn’t want to be bothered with more risks and more demands.”

In 1965, McDonald’s went public; 300000 shares were initially sold at $22.50 each, later jumping to $49. Kroc had made $3 million on the sale. But, Kroc wanted more and embarked on an ambitious campaign for foreign markets. First, the U.K., then Europe, kroc began to erect Golden Arches in almost every continent.

In 1974, Kroc stepped down as CEO of the company he single-handedly grew into a global empire, but remained on as Senior Chairman of Mcdonald’s Corporation. He died of heart failure in 1984 at the age of 81. In one of the greatest success stories of our time, Kroc took a small but successful California based hamburger restaurant and expanded it into what is today a worldwide chain with almost 500000 employees and $20 billion in revenue.